Western CPE Blog
Breaking tax and accounting news and analysis from the experts at Western CPE.
Advanced Child Tax Credit Payments: What to Know
By: LISTEN NOW TO THE eTAX ALERTClick the Play Button to Listen for Free.https://youtu.be/NO7cBlZPJtk TRANSCRIPT: ADVANCED CHILD TAX CREDIT PAYMENTS Sharon Kreider: Hi, I’m Sharon Kreider, CPA, and we’re here to talk about the child tax credit and particularly the advanced payments, which begin July 15th, 2021. First, a little background on the child tax credit. Background: We’ve had a child tax credit before, and it was expanded in prior legislation. This is another expansion of the child tax credit. It is from the American Rescue Plan Act, which was at the beginning of March 2021. And the credit for this expansion is presently …
Q&A Special: PPP LOAN UPDATES & CALIFORNIA’S TAX CONSEQUENCES
& Q&A Special: PPP LOANS & CALIFORNIA TAX CONFORMITY CONSEQUENCES What’s going on with second draw PPP Loans, and has California completely conformed to Federal Tax Law? Our new Q&A Special features Sharon Kreider and Karen Brosi explaining the consequences of California’s new conformity and PPP Loan Updates. California is among the 20 states that don’t have automatic conformity with Federal law Publicly traded companies aren’t allowed to take the deduction of expenses paid with loan proceeds LISTEN NOW TO THE Q&A SPECIAL Click the Play Button to Listen for Free. https://youtu.be/hF1sOHn2EVk Want More? Read the full transcript Sharon Kreider: …
Corporate Tax Rate Increases: The Good, The Bad, and The Ugly
Sharon’s RoundTable Special: Corporate Tax Rate Increases The Good, The Bad, and The Ugly This new roundtable talk about raising corporate tax rates is proudly presented by our resident tax authority, Sharon Kreider, CPA. We’re joined by guest experts Jessica Jeane, J.D., NSA’s Director of Public Policy, and Lisa Lopata, J.D., Expandopedia’s Tax Analyst & Editor. LISTEN NOW TO THE ROUNDTABLE Click the play button to listen for Free. https://youtu.be/Vlci4r15p1I BACKGROUND DATA Want More? Read the full transcript Sharon Kreider: Hi, I’m Sharon Kreider. I’m kindly known as the Resident Expert at Western CPE. Although today I’m not in Bozeman, …
Advisors – Tell Your Millionaire Clients to Prepare for Audits
Audits are coming. If you read in the middle of the night like me, you might have read a working paper from the National Bureau of Economic Research (NBER) on the tax paid by the top 1% of households. The top 1% of households failed to report 21% of their income with six points of that number due to strategies that were so sophisticated that even if that upper-income person’s tax return was randomly audited under the NRP audit, it didn’t detect them within six points of the 21%. WATCH NOW TO LEARN MORE Click the play button below to watch. https://youtu.be/3SJakLAdEPI …
Advising President Biden on Deductions and Credits
By: I think we all have ideas on what tax reform should look like. I’m putting a few items in writing as if I were advising President Biden. There are three basic assumptions considered in this discussion of President Biden’s tax proposals: (1) Our country has run up a big covid-related deficit, and we will have to pay the deficit down someday. (2) Our economy is fragile because of Covid, so legislators will need to consider the immediate impact on our economy of all proposed tax increases. (3) Tax law changes require Congressional action, with all of the political problems involved. …
You Say Yes, I Say No – I Say High, You Say Low : Corporate Tax Reform Debate Continues
By: Should five percent appear too small Be thankful I don’t take it all ’Cause I’m the taxman -The Beatles, Taxman While The Beatles were apparently united in their opposition to the U.K.’s progressive income tax regime in 1966 (I wasn’t there), the corporate tax reform debate continues today on Capitol Hill. Lawmakers, economists, and tax experts alike have varying conclusions about the magic methodology and the overall impact of increasing U.S. corporate taxes. Generally, the current political climate surrounding the debate looks something like this: President Joe Biden has proposed increasing the corporate income tax rate from 21 to 28%; …
Employee Retention Credit Essentials
Article Note: Many companies did not utilize the ERC because it couldn’t be used in concert with a Paycheck Protection Program (PPP) loan. The Consolidated Appropriations Act, 2021 (CAA) retroactively removed the mutual exclusivity between the two incentives. The CAA made the ERC now available for 2020 periods, and the American Rescue Plan (ARP) extended the ERC through 2021. Companies who cast aside the ERC for the PPP in 2020 should review past and current quarters for potential eligibility because the benefit can be a lifesaver. The Employee Retention Credit (ERC) is an incredibly valuable coronavirus relief measure that …
Pandemic Relief Fund for Restaurants Is Open – The Money Won’t Last
Article Note: The SBA began accepting Restaurant Revitalization applications on May 3. The Restaurant Revitalization Fund (RRF) is a first-come-first-serve program. The Paycheck Protection Program ends on May 31, 2021. Finally, April 15, I mean May 17, is almost behind us. We should get a breather for at least a few weeks. We should, but “no.” Our business clients have something else in mind as they wait impatiently for us to get back to their business. Two items loom: The Restaurant Revitalization Fund grant program and the (second draw) Paycheck Protection Program. The Paycheck Protection Program ends on May …
CORPORATE TAX RATE: The Benefits of Raising Rates Outweigh the Negatives
By: The Benefits of Raising the Corporate Income Tax Rate Outweigh the Negatives President Biden wants to increase the corporate income tax rate to 28%. My advice to him and Congress is that we should do it. For over a year, the United States has suffered an economic crisis due to a pandemic. Increasing tax revenue will allow the government to fund initiatives and programs to help the country regain economic balance. A 7% rise in the corporate income tax rate is a modest jump that will result in a significant revenue contribution. The main objection to corporate income taxes these …
Q&A Special: Deadlines – Tax Increases – QBIs – 1031 Exchanges
By: Doug Stives, CPA
Greetings. Can you see the light at the end of the tax season tunnel? Pushing forward, we are proud to present a new Q&A Special that’s timely and topical. Sharon Kreider of Western CPE interviews tax expert Doug Stives in this insightful Q&A discussion about the May 17 deadline, upcoming tax increases, QBI elimination, and 1031 exchanges. Doug Stives examines if the extensions were generous to the right groups, explores QBI elimination or simplification, and answers an interesting 1031 exchange question. LISTEN NOW TO THE Q&A SPECIAL Click the play button below to listen. https://youtu.be/qr2ATPBv91U Transcript: [Sharon] I’m Sharon Kreider and …
Advising President Biden on Tax Increases
I think we all have ideas on what tax reform should look like for a better America. I’m putting a few items in writing as if I were advising President Biden. We should always remember that to provide comprehensive advice on tax policy. We would need to assemble a team that includes domestic and international tax experts, an economist, a statistician, a trend specialist, Dr. Phil, and a fortune-teller. Three Basic Assumptions There are three basic assumptions applied in the following discussion of President Biden’s tax proposals. (1) Our country has run up a big covid-related deficit, and we will …
Q&A Special: American Rescue Act of 2021
By: Everyone wants more clarity and insight into the American Rescue Act ever since President Biden signed it into law late last week. Especially since the new stimulus payments went out and the IRS extended the filing deadline to May 17th. Sharon Kreider of Western CPE interviews tax expert Robert Keebler in this insightful Q&A discussion about the American Rescue Act. Robert Keebler delves into the impact on high-net-worth clients, the typical family of four, and the business-related tax ramifications. Listen Now to the Q&A Special Click the play button below to listen. https://youtu.be/JjxsPIFavbA Transcript: Sharon: Hi, I’m Sharon Kreider and …
IRS Funding – To Increase or Not to Increase, That is the Question
Had you asked William Shakespeare for insight on the importance of well funding a country’s tax administrator, it is unlikely that he, renowned for both sonnets and alleged tax evasion, would have much cared. And if you had over the years consistently asked members of Congress, the answer would have likely varied. Ask a tax practitioner today, however, and you will almost certainly hear: “Fund the IRS.” #FundtheIRS Although not everyone agrees that the IRS needs to be better funded, take one look on “Tax Twitter,” and you will quickly see the call amongst CPEs, EAs, and other tax professionals …
Advising President Biden on Estate and Gift Tax Proposals
My wealthy (and very conservative) client called after the election results were apparent and asked, “What is Biden going to do to me?” He didn’t want a wait-and-see answer. And he didn’t want me to say, “go see your estate attorney.” He wanted my opinion — perhaps to weigh against the attorney’s opinion. I know that you’re facing the same problem with your clients. Here’s an opinion piece for you. https://www.youtube.com/watch?v=lAyrlRq7k8o Two Assumptions There are two basic assumptions applied in the following discussion on President Biden’s estate tax proposals. Our country has run up a big Covid-related deficit, and we …
Sharon’s First 100 Days: 13 Tax Policy Ideas for America
First, I am a conservative progressive or maybe a progressive conservative. In other words, this isn’t political. It is instead intended to be ideas on “tax reform.” I’m not an economist, and I’m not part of the Congressional Budget Office, so someone needs eventually to tell me that my ideas are pipe dreams or cost too much, or the politics are wrong. A FEW PREMISES: – Tax increases are coming. We have to pay down debt eventually. The government just spent $4 trillion (with more coming) for businesses and individuals hurt by the Covid-19 pandemic. – Nothing should be done …
Accounting Standards Updates Effective for the 2020 Calendar Year
By: Jeff Sailor, CPA
Article At A Glance: Due to the pandemic, last-minute delays were applied to the effective dates for the Accounting Standards 2014-09 Revenue from Contracts with Customers New updates change the classification of liability or equity financial instruments that include down round features. Topic 718 was expanded for stock compensation to include share-based payments for nonemployees’ goods and services. Updates were made to the Collections definition to align with the industry definition. Effective dates for 2016-02 Leases have been delayed to fiscal years beginning after December 15, 2021. Greetings and Happy New Year! As we all look with anticipation to …
Tax Season News for Individuals and their 2020 Tax Return
Article Note: The IRS is pushing back the beginning of the 2020 tax season to February 12. The IRS needs more time to prepare after the Covid-19 relief act that took effect in late December. And yes, as of now, the tax filing deadline is still April 15. To speed refunds during the pandemic, the IRS recommends that taxpayers submit their returns electronically and use direct deposit as soon as they’re ready. 1. Economic impact Round one and round two economic impact payments (EIP) are reconciled on the 2020 tax return. The EIPs were an advance. If the client received …
2nd Draw PPP Loans: SBA Explains Eligibility & Amount
Article At A Glance: The new Economic Aid Act signed into law on December 27, 2020, authorizes the SBA to guarantee PPP 2nd Draw Loans. A borrower is eligible for a Second Draw PPP Loan only if it has 300 or fewer employees and experienced a revenue reduction in 2020 relative to 2019. The borrower must have experienced a revenue reduction of 25% or greater in 2020 relative to 2019. Gross receipts do not include the forgiven amount of the First Draw PPP loan. Second draw loans are forgiven if the loan proceeds are spent on eligible payroll costs and …
FinCEN Tells Cryptocurrency Traders That It’s a New Year
Article At A Glance: FinCEN Notice 2020-2 announced cryptocurrency accounts held outside of the US as a reportable account for FBAR filings. The notice does not provide an effective date for the reporting change. Watch for further developments. Cryptocurrency exchanges make it simple to move from US dollars (or whatever) into a cryptocurrency and vice versa. New regulations will make cryptocurrency exchanges act more like banks. These regulations may signal that cryptocurrency’s wild west days are numbered. In Notice 2020-2, the Financial Crimes Enforcement Network (FinCEN) announced that the regulations implementing the Bank Secrecy Act (BSA) would be amended to add cryptocurrency …
9 IRS Reminders for Individuals & their 2020 Tax Returns
Article Note: IRS Resources: COVID Tax Tip 2025-172, Getting Ready for Taxes, Steps to Take Now to Get a Jump on Your Taxes Recovery Rebate The economic rebate received in 2020 was an advance. The advance needs to be reconciled on the 2020 tax If the client received less as an advance than he or she should have, they might be able to claim the recovery rebate credit on their 2020 return if one of the following applies to them: They didn’t receive an Economic Impact Payment in They are single, and their payment was less than $1,200. They …